Q1 2024 NEXGEL Inc Earnings Call

Hello.

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Operator: Please stand by, we're about to begin. Good afternoon, everyone. My name is Bo, and I will be your conference operator today. At this time, I would like to welcome everyone to Nexgel's first quarter 2024 earnings conference call.

Please standby we're about to begin.

Beau: Good afternoon, everyone. My name is Beau and I will be your conference operator today at this time I would like to welcome everyone to Nextgen <unk> first quarter 2024 earnings conference call.

Operator: At this time, all participants are in a listen-only mode. Later, you will have the opportunity to ask questions during the question and answer session. You may register to ask a question at any time by pressing star 1 on your telephone keypad. You may withdraw yourself from the queue by pressing star 2. Also, today's call is being recorded, and I will be standing by if anyone should need any assistance. And now, at this time, I'd like to turn the call over to Valter Pinto, Managing Director of KCSA Strategic Communications, for introductions. Please go ahead.

Beau: At this time all participants are in a listen only mode. Later, you will have the opportunity to ask questions. During the question and answer session. You May Register to ask a question at any time by pressing star one on your telephone keypad, you may withdraw yourself from the queue by pressing star too.

Beau: Also today's call is being recorded and I will be standing by if anyone should need any assistance and now at this time I'd like to turn the call over to Valter Pinto managing director of Casey S. A strategic communications for introductions. Please go ahead Sir.

Valter Pinto: Thank you, Operator. Good afternoon, and welcome, everyone, to Nexgel's first quarter 2024 Financial Results Conference Call. I am joined today by Adam Levy, Chief Executive Officer, and Adam Drapczuk, Chief Financial Officer. Before we begin, I'd like to remind everyone that statements made during today's conference call may be deemed forward-looking statements within the meaning of the safe harbor of the Private Securities Litigation Reform Act of 1995. And actual results may differ materially due to a variety of risks, uncertainties, and other factors.

Valter Pinto: Thank you operator, good afternoon, and welcome everyone. The Nextgen <unk> first quarter 2024 financial results Conference call I'm joined today by Adam Levy, Chief Executive Officer, and Adam drastic Chief Financial Officer.

Speaker Change: Before we begin I'd like to remind everyone that statements made during today's conference call maybe deemed forward looking statements.

Speaker Change: Within the meaning of the Safe Harbor of the private Securities Litigation Reform Act of 1095, and actual results may differ materially due to a variety of risks uncertainties and other factors for a detailed discussion of some of the ongoing risks and uncertainties in the company's business I refer you to the press release issued this afternoon and filed with the SEC on form 8-K as well as.

Speaker Change: The company's reports filed periodically with the SEC.

Company disclaims any intention or obligation to update or revise any forward looking statements, whether as a result of new information future events or otherwise unless otherwise required by law with that it's my pleasure to turn the call over to Mr. Adam Levy Adam. Please go ahead.

Valter Pinto: For a detailed discussion of some of the ongoing risks and uncertainties in the company's business, I refer you to the press release issued this afternoon and filed with the SEC on Form 8K, as well as the company's reports filed periodically with the SEC. The company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, unless otherwise required by law. With that, it's my pleasure to turn the call over to Mr. Adam Levy. Adam, please go ahead.

Adam R. Levy: Thank you, Valter, and thank you, everyone, for joining us today to discuss our first quarter of 2024 financial and operating results. Following a record year of growth in 2023, I am pleased to report our first quarter financial results that demonstrate steady growth year over year and preparedness for the significant growth levers we expect in 2024. First quarter revenue increased by 104% year-over-year to approximately $1.27 million, exceeding our first quarter revenue guidance of $1.25 million provided during our year-end conference at the beginning of April. As a reminder, revenue during this quarter does not include the non-refundable deposit of $176,000 from AbbVie against their first purchase order.

Adam R. Levy: Thank you Walter and thank you everyone for joining us today to discuss our first quarter 2024 financial and operating results.

Adam R. Levy: Following a record year of growth in 2023, I'm pleased to report our first quarter financial results that demonstrate steady growth year over year and preparedness for significant growth levers, we expect in 2024.

Adam R. Levy: First quarter revenue increased by 104% year over year to approximately 1.2 dollars 7 million.

Adam R. Levy: Exceeding our first quarter revenue guidance of 1.25 million provided during our year end conference at the beginning of April.

Adam R. Levy: As a reminder, revenue during this quarter does not include the nonrefundable deposit of $176000 from Abbvie against their first purchase order.

Adam R. Levy: For the first quarter, our gross profit margin was approximately 22 percent as compared to negative gross margin for the same period the prior year, and an increase sequentially as compared to 14.6 percent in Q4. Our strong top line results reflect an increase in both contract manufacturing and consumer branded product business segments, with revenue increasing year over year by approximately 58% and 178%, respectively. sequentially, total revenue increased by approximately 17%, while the consumer branded product segment increased by approximately 57%, reflecting our first full quarter of revenue contribution from the acquisition of Cancoderm. While we continue on our path of steady growth year over year, both in branded sales and contract manufacturing, we are also investing in future growth of the business. Our investments made during the quarter were twofold.

Adam R. Levy: For the first quarter, our gross profit margin was approximately 22% as compared to negative gross margin for the same period, the prior year and an increase sequentially as compared to 14, 6% in Q4 of 'twenty three.

Adam R. Levy: Our strong top line results reflect an increase in both contract manufacturing and consumer branded product business segments with revenue increasing year over year by approximately 58% and 178% respectively.

Adam R. Levy: Sequentially total revenue increased by approximately 17%, while the consumer branded products segment increased by approximately 57%.

Adam R. Levy: Selecting our first full quarter of revenue contribution from the acquisition of can't go there.

Adam R. Levy: While we continue on our path of steady growth year over year, both in branded sales and contract manufacturing. We are also investing in future growth of the business.

Adam R. Levy: Our investments made during the quarter were two fold first alongside capacity expansion in our converting and packaging facility in Texas, We purchased and are installing state of the art new equipment and secondly, we are making the final investments in preparations for meeting European compliance requirements.

Adam R. Levy: First, alongside capacity expansion in our converting and packaging facility in Texas, we purchased and are installing state-of-the-art new equipment. And secondly, we are making the final investments in preparations for meeting European compliance requirements. In 2023, we acquired ownership in the CG converting and packaging business and its facility in Texas.

Adam R. Levy: In 2023, we acquired ownership must see G converting and packaging business and its facility in Texas. The addition of this facility not only added an additional revenue stream for us, but also provided us with optionality to increase capacity in order to support the new client relationships that we expect given our robust pipeline.

Adam R. Levy: The addition of this facility not only added an additional revenue stream for us but also provided us with the option to increase capacity in order to support the new client relationships that we expect given our robust pipeline of new customers. As we have mentioned, we are in the process of completing the expansion of our CG converting and packaging manufacturing facility to double its existing square footage, providing us with the needed capacity to support the increased demand that we expect to see this year.

Adam R. Levy: <unk> of new customers.

As we have mentioned we are in the process of completing the expansion of our CG converting and packaging manufacturing facility to double its existing square footage, providing us with the needed capacity to support the increased demand that we expect to see this year.

Adam R. Levy: While the expansion is funded by our landlord in terms of the building construction, during the quarter, we invested $152,000 in CapEx for state-of-the-art automated machinery and related clean room facilities. Going forward, we have minimal additional CapEx for this project to complete the expansion currently targeted for this summer. A key driver for this investment is our partnership with AbbVie as the exclusive supplier of gel pads for their Rosonic Rapid Acoustic Pulse device for reduced cellulite appearance.

Adam R. Levy: While the expansion is funded by our landlord in terms of the building construction during the quarter. We invested 152000 in Capex for state of the art automated machinery and related clean room facilities.

Adam R. Levy: Going forward, we have minimal additional capex for this project.

To complete the expansion currently targeted for the summer.

Adam R. Levy: A key driver for this investment is our partnership with Abbvie as the exclusive supplier of gel pads for their rysanek rapid acoustic pulse device for reduced cellulite appearance.

Adam R. Levy: We still expect to launch this device by the end of the year and will continue to work closely with their team. As I mentioned above, we have invoiced them $176,000 as a nonrefundable deposit that will be applied against future orders. This has yet to be included in our quarterly revenue. In branded consumer products, we currently have 31 health and beauty products sold direct-to-consumer and several growth strategies in place, which are driving a stronger retail presence in North America and eventually our expansion into Europe.

We still expect to launch this device by the end of the year and continue to work closely with their team.

Adam R. Levy: As I mentioned above we have invoiced them $176000 as a nonrefundable deposit that will be applied against future orders. This has yet to be included in our quarterly revenue.

Adam R. Levy: In branded consumer products. We currently have 31 health and beauty products sold direct to consumer and several growth strategies in place, which are driving a stronger retail presence in North America and eventually our expansion into Europe.

Adam R. Levy: The key addition to our product portfolio is our newly acquired CancoDerm product. This is our first full quarter of revenue contribution from six new Cankloderm products, which focus on treating the symptoms of psoriasis. The CancoDerm line complements our current product offering and has been a contributor to our quarterly revenue growth. In Q4, we began the process of attaining MDR compliance, which will provide us with the ability to self-certify all of our Class 1 devices for sale into the European market.

Adam R. Levy: The key addition to our product portfolio as our newly acquired <unk> product line.

Adam R. Levy: This is our first full quarter of revenue contribution from six new Kenkel derm products, which focus on treating the symptoms of psoriasis.

Adam R. Levy: Kenkel Germline complements our current product offering and has been a contributor to our quarterly revenue growth.

Adam R. Levy: In Q4, we began the process of attaining MTR compliance, which will provide us with the ability to self certify all of our class one devices for sale into the European market costs.

Adam R. Levy: Costs associated with MDR compliance carried into Q1 as expected in the amount of $102,000. Achieving the certification is extremely important for our long-term growth given the opportunity we have to enter the European market through our partnership with Stata as well as other potential distributors. We expect a final and lesser amount of fees relating to MDR compliance in Q2 in anticipation of distributing and commercializing our first products in Europe later this summer.

Adam R. Levy: Costs associated with M. D are compliant carried into Q1 as expected and the amount of $102000.

Adam R. Levy: Cheating the certification is extremely important for our long term growth given the opportunity we have to enter the European market through our partnership with startup as well as other potential distributors.

Adam R. Levy: We expect the final a lesser amount of fees relating to MTR compliance in Q2 in anticipation of distributing commercializing our first products in Europe later this summer.

Adam R. Levy: In total, our expenses will be reduced and more normalized in the second half of 2024 as our facility expansion is completed and we receive MDR compliance. Cash at March 31st, 2024 was $2.4 million as compared to $2.7 million at December 31st, 2023. In February of 2024, we also completed a registered direct offering led by insiders for net proceeds of just under $1 million at attractive terms. I feel very comfortable with the runway of cash we have on hand to fund our operations going forward. With that, I would like to turn the call over to our CFO, Adam Drapczuk. Adam.

Adam R. Levy: In total our expenses will be reduced and more normalized in the second half of 2024 as our facility expansion is completed and we receive MTR compliance.

Adam R. Levy: Cash at March 31, 2024 was $2 4 million as compared to $2 7 million at December 31 2023.

Adam R. Levy: In February of 2024, we also completed a registered direct offering led by insiders for net proceeds of just under $1 million at attractive terms.

Adam R. Levy: Feel very comfortable with the runway of cash we have on hand to fund our operations going forward.

Adam R. Levy: With that I would like to turn the call over to our CFO Adam drops it Adam.

Adam: Thank you Adam.

Adam E. Drapczuk: Today, I'll review financial highlights of our first quarter 2024 results. For the quarter ended March 31, 2024, revenue totaled $1.27 million, an increase of $646,000, or 104%, as compared to $620,000 for the quarter ended March 31, 2023. The increase in revenue was driven by sales growth and contract manufacturing of approximately 58% and consumer branded products of 170. Gross profit totaled $277,000 for the three months ended March 31, 2024, compared to a gross loss of $57,000 for the three months ended March 31, 2023. The increase of $334,000 in gross profit year-over-year was primarily due to an increase in consumer-branded products.

Adam: I'll review financial highlights of our first quarter 2024 results for the quarter ended March 31, 2024 revenue totaled $1 $2 7 million, an increase of 646000 or 104% as compared to 620000.

Adam E. Drapczuk: Gross profit margin for the first quarter of 2024 was 21.9% compared to a negative gross margin for the first quarter of 2023 of 9.2% and a gross profit margin of 14.6% in the fourth quarter of 2023. Cost of revenues increased by $312,000, or 46.1%, to $989,000 for the three months ended March 31, 2024, as compared to $677,000 for the three months ended March 31, 2023. The increase in the cost of revenues is primarily aligned with the increase in revenue growth.

Adam: For the quarter ended March 31 2023.

Adam: The increase in revenue was driven by sales growth in contract manufacturing of approximately 58% at consumer branded products of 178%.

Adam: Gross profit totaled 277000 for the three months ended March 31 2024.

Adam: To a gross loss of 57000 for the three months ended March 31 2023.

Adam: The increase of 334000 in gross profit year over year was primarily due to the increase in consumer branded products.

Adam: Gross profit margin for the first quarter of 2024 was 21, 9% compared to a negative gross margin for the first quarter of 2023 of nine 2% and a gross profit margin of 14, 6% in the fourth quarter of 2023.

Adam: Cost of revenues increased by 312000 or 46, 1%.

989000 for the three months ended March 31, 2024, as compared to 677000 for the three months ended March 31 2023.

Adam: The increase in cost of revenues is primarily aligned with the increase in revenue growth.

Adam E. Drapczuk: Selling, General, and Administrative Expenses increased by $349,000, or 43.8%, to $1.1 million for the three months ended March 31, 2024, as compared to $797,000 for the three months ended March 31, 2023. The increase in selling general and administrative expenses is primarily attributable to an increase in advertising, marketing, and Amazon professional and consulting fees. End of compensation and benefits explanation.

Adam: Selling general and administrative expenses increased by 349000 or 43, 8% to $1 1 million for the three months ended March 31, 2024 <unk>.

As compared to 797000 for the three months ended March 31 2023.

Adam: The increase in selling general and administrative expenses is primarily attributable to an increase in advertising marketing and Amazon.

Adam: Professional and consulting fees.

Adam: And the compensation and benefits expense.

Adam E. Drapczuk: Research and development expenses decreased by $27,000 to $2,000 for the three months ended March 31, 2024, from $29,000 for the three months ended March 31, 2023. The net loss for the three months ended March 31, 2024 was $905,000, as compared to a net loss of $807,000 for the three months ended March 31, 2023. As of March 31, 2024, the company had a cash balance of $2.4 million, which included an approximately $1 million registered direct offering led by Insight.

Adam: Research and development expenses decreased by 27000 to $2000 for the three months ended March 31, 2024 from 29000 for the three months ended March 31 2023.

Adam: Net loss for the three months ended March 31, 2024 was 905000 as.

Adam: As compared to a net loss of 807000 in the three months ended March 31 2023.

Adam: As of March 31, 2024, the company had a cash balance of $2 4 million, which included an approximately $1 million registered direct offering led by insiders.

Adam E. Drapczuk: As Adam explained earlier, there was a net usage of cash for investment in the first quarter of 2024 due to several non-recurring key strategic investments and acquisition costs. I would now like to open the call to questions. Operator.

Adam: As Adam explained earlier, there was a net usage of cash for investment in the first quarter of 2024 due to several non recurring key strategic investments and acquisition costs.

Speaker Change: I would now like to open the call for questions.

Speaker Change: Operator.

Operator: Thank you. Ladies and gentlemen, at this time, if you would like to ask a question, please press star one on your telephone keypad. You may remove yourself from the queue at any time by pressing star two. Once again, that is star one to ask a question, and we'll pause for just a moment to allow questions. We'll go first this afternoon to Naz Rahman at Maxim.

Speaker Change: Thank you ladies and gentlemen at this time, if you would like to ask a question. Please press the star one on your telephone keypad, you may remove yourself from the queue at any time by pressing star to once again that is star one to ask a question and we'll pause for just a moment to allow questions to queue.

Raman: We will go first this afternoon, two nos Raman at Maxim Group.

Nazibur Rahman: Hi, everyone. Thanks for taking my questions and congratulations on the progress. I have a few.

Raman: Hi, everyone. Thanks for taking my questions and congratulations on the progress I Havent skew first I want to start on the potential European launch could you talk a little bit more about your strategy in terms of commercialization in Europe like what product initial answer the market and which card.

Nazibur Rahman: First, I want to start on the potential European launch. Could you talk a little bit more about your strategy in terms of commercialization in Europe? Like, what products could initially enter the market? And which countries may you initially enter or sell in initially? Also, could you talk a little bit about how commercializing in Europe is similar or different than the United States?

Raman: May you initially enter or sell out initially also could you talk a little bit about how commercializing in Europe is similar or different than the United States.

Adam R. Levy: Sure, I know. It's good to hear from you again.

Speaker Change: Sure Hi, now it's good to hear from you again, so the first products. When you have MTR compliance as a medical device company will be class one medical devices. So when we pass our inspection, which is currently scheduled for the end of May This month.

Adam R. Levy: So the first products, when you have MDR compliance as a medical device company, will be Class I medical devices. So when we pass our inspection, which is currently scheduled for the end of May this month, we will then be able to self-certify and release those products immediately. We do have interest in Australia, the UK, and the Nordic countries for the Hexagels, which is a Class I and is our second largest selling product here in the U.S. We also have a lot of interest in Silverseal. However, Silverseal, because it's a wound care device, is a Class III. So realistically, you can't self-certify it.

Speaker Change: We will then be able to self certify and released those products immediately we do have interest in Australia. The U K in the Nordic countries for the <unk>, which is a class one and is our second largest selling product here in the U S. We have a lot of interest also in Silversea. However, silversea will because it's a wound care device is a class.

Speaker Change: So realistically you can't you can't self certify it and realistically that will not be cleared until fourth quarter at the earliest fourth quarter, maybe first quarter. So youre looking at our second quarter release of next year.

Adam R. Levy: And realistically, that will not be cleared until the fourth quarter. At the earliest, the fourth quarter, maybe the first quarter. So you're looking at a second quarter release next year for Silverseal. Cancoderm has also garnered some interest. And we actually have some smaller Eastern European and Nordic countries that want to distribute that as well. So that's probably the first thing that you'll see as we get that.

Speaker Change: For Silversea.

Speaker Change: <unk> is also a regardless of interest and we actually have some smaller eastern European and Nordic countries that want to distribute that as well. So that's probably the first thing that youll see as we as we get that moving.

Adam R. Levy: Got it. Could you talk a little bit about the difference in commercializing? What are your different experiences commercializing in Europe versus the United States, and what do you expect in terms of that?

Speaker Change: Got it could you talk a little bit about.

Speaker Change: The difference in commercializing a different comparison prior sizing Europe versus United States, What do you expect in terms of that.

Adam R. Levy: Well, there are a lot of differences, and understanding a market is really important. That's one of the reasons why we're looking for distribution partners, right? So I would never really attempt to go into a place like Stata and explain to them how they should market our products in Spain or in England or somewhere where they are already and they have a successful brand. The same reason they selected us to help them understand the U.S. market. So having good partnerships, having good distribution partners is really the key. And we kind of defer to what they want to do and what they want to do in their territories because they're the experts.

Speaker Change: Well, there's a lot of differences in understanding our market is really important that's one of the reasons why we're looking for distribution partners right. So I would never really attempt to go into a place like SCADA and explain to them, how they should market our products in Spain, or in England, or somewhere where they already are and they have a successful brand.

Speaker Change: The same reason they selected us to help them understand the U S market, so having good partnerships, having good distribution partners.

Speaker Change: Really the key and we kind of defer to what they want to do and what their linear territories because they are the experts there.

Nazibur Rahman: The next question I have is on your capacity expansion. Once you're done with all the construction work and validating all the equipment, you can go ahead and start building. Is there an FDA inspection that is required, or are you expecting an FDA inspection and what might the timing of that be?

Speaker Change: Got it that's helpful.

Speaker Change: Listen I have is on your capacity expansion once youre done with.

Speaker Change: All the construction work.

Speaker Change: And validating all the.

Speaker Change: Equipment.

Speaker Change: Is there an ethane inspection that is required or are you expecting like an ethane extraction and what might the timing of that be.

Speaker Change: Yes, no, it's probably not that would be very unlikely.

Adam R. Levy: Yeah, no, probably not. That would be very unlikely.

Adam R. Levy: We're a 13485 medical device facility. ISO inspections, for sure. The FDA usually only comes in very sporadically and would only come in if there were a problem, but the FDA doesn't really inspect your equipment like that for a non-drug facility like that.

Speaker Change: We're 13 485.

Speaker Change: Medical device facility ISO inspections for sure. The FDA, usually only comes in very sporadically and would only come in if there were a problem, but the FDA doesn't really inspect your equipment like that for a non.

Speaker Change: Drug facility like we are.

Nazibur Rahman: Got it. And also, just on a similar point, would you expect an inspection of some sort or plan an inspection of some sort by Abbey or any of your other partners regarding the expansion?

Speaker Change: Got it and also just on a similar point would you expect.

Speaker Change: <unk> of some sort or patterns based on some sort by abbvie or any of your other partners regarding the expansion.

Adam R. Levy: Well, they'll do their normal yearly inspections. They have a requirement to come and inspect, just like we inspect them. So we just completed our inspection of the manufacturing facility at Stata for the product they'll be shipping to us. So inspections are a regular part of the business. They go on all the time. So yes, we'll have them, the exact timing of which I'm not sure of. The biggest inspection you can always count on, though, is ICE. ISO inspections are regularly scheduled.

Speaker Change: Well they'll do their normal yearly inspections, they'll do they have a requirement to come and inspect us like we inspect that alright. So we we just completed our inspection of the manufacturing facility and startup for the product they'll be shipping to us. So inspections are a regular part of the business. They go on all the time. So yes, we'll have them the exact timing.

Speaker Change: Which I'm not sure of the biggest inspections, you can always count on though with ISO.

Speaker Change: The ISO inspection on our regularly scheduled.

Speaker Change: Got it.

Nazibur Rahman: Got it. On Cancaderms, seeing as this is your first full quarter of launch and the first full quarter where it was under Nexgel stewardship, would you sort of talk about how to talk about Kindred's progress under Nexgel and sort of... Anything that shifted from where it was back in 2023 when it was a private label?

Speaker Change: On your tank.

Speaker Change: <unk>. So you have a lot of your first full quarter of launch and the first full quarter, where it was under axial stewardship, but just sort of talk about how.

Speaker Change:

Speaker Change: Can you talk about your gross progress under nutshell and sort of any.

Speaker Change: Anything that shifted from where it was back in 2023, when it was private label.

Adam R. Levy: So, you know, the main thing about it is that there were only pleasant surprises to start with. We thought that we could help in optimizing the advertising. That's going very well. Of course, the optimization continues and goes along.

Speaker Change: So the main thing about it is that there were they were only pleasant surprises to start with.

Speaker Change: We thought that we could help in optimizing the advertising that's going very well of course, the optimization continues and goes along.

Adam R. Levy: As I mentioned earlier in the call, when you asked the other question, we now have an interest in a couple of smaller territories and distribution in Europe. These are all incremental, you know, additions to something that we already own. In addition, we still haven't begun the cross-promotion. So, we're working on an update and upgrade to our MetaGel retail website. When that update is completed, we will then begin kind of announcing to the KencoDerm customers, and they have about 35,000 emails and 9,000 Facebook followers, that, you know, hey, you know, good news, we've got a sister company, use code Kenco, get 15% off, check out these products. We will begin to cross-promote between the two companies. And that hasn't started yet. It will start when the website is completed in June.

Speaker Change: As I mentioned on the on the earlier in the call. When you ask the other question. We now have interest in a couple of smaller territories and distributing it in Europe. These are all incremental additions to something that we already own.

Speaker Change: In addition, we still havent begun the cross promotion. So we're working on an update and upgrade to our meta gel retail website. When that update is completed we will then begin kind of announcing to the kimco German customers and they have about 35000 emails and 9000 Facebook followers that hey.

Speaker Change: Good news, we've got a sister company used code kimco get 15% off check out. These products will begin to cross promote between the two companies and that hasn't started yet that will start with the web sites completed in June.

Nazibur Rahman: If I recall correctly, you guys have been going back to in-person trade shows. Could you talk a little bit about the reception and feedback you're getting relative to Nexgel technology and potentially new verticals or industries you might be entering with the technology?

Speaker Change: Got it and then one last question.

Speaker Change: If I recall correctly, you guys have been ongoing back to in person trade show could you talk about a bit about the reception and feedback you're getting.

Speaker Change: Relative to next level technology, and potentially new verticals or industries, you might be had trained with the technology.

Adam R. Levy: Yeah, so I didn't understand the first part about the trade show.

Speaker Change: Yes, so I didn't get the first part about the trade show and that is what was the question there.

Nazibur Rahman: What kind of feedback have you been getting from the trade shows? We've been getting great feedback. There are some really interesting companies at a very early stage that we are making test rolls for that have all sorts of applications in medical devices. How successful they'll be, and they're not huge customers now because they're ordering $5,000 or $10,000 or $15,000 worth of gel to run their experiments and develop their projects. But there seem to be lots of really cool applications for our technology, and we think a few of them could end up being very big, but most of them are still in the very early stages.

Speaker Change: Okay.

Speaker Change: What kind of feedback have you been getting from the trade show as well. So we get we've been we've been yes, we've been getting great feedback, there's some really interesting.

Nazibur Rahman: Got it. Thanks for taking my question and, once again, congrats on the progress. Thank you. Thank you, and just a reminder.

Speaker Change: Companies that very early stage that we are making test rolls for that have all sorts of applications in medical device.

Speaker Change: How successful they'll be and they are not huge customers now because they are ordering five or 10 or $15000 worth of gel to run their experiments and develop their projects, but there seems to be lots of really cool applications for our technology and we think a few of them could end up being very big but most of them are still very early stage.

Speaker Change: Got it thanks for taking my question and once again congrats on the progress.

Speaker Change: Thank you.

Operator: Thank you. And just a reminder, ladies and gentlemen, Star 1, please, for any further questions this afternoon. And, ladies and gentlemen, it appears we have no further questions this afternoon, so that will bring us to the conclusion of today's call. Ladies and gentlemen, thank you for joining Nexgel's first quarter 2024 earnings conference call. Again, thank you for joining us and we wish you all a great evening. Goodbye.

Thank you and just a reminder, ladies and gentlemen star one please for any further questions. This afternoon.

Unnamed: [inaudible]

Speaker Change: And gentlemen, it appears we have no further questions. This afternoon, so that will bring us to the conclusion of today's call.

Speaker Change: Ladies and gentlemen, thank you for joining <unk> first quarter 2024 earnings conference call again, thanks for joining and we wish you all a great evening Goodbye.

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